A.M. Best dropped the financial strength ratings on two California workers’ comp carriers–Encino-based Republic Indemnity Insurance Pool and Woodland Hills-based Zenith National Insurance Group– from “A” to “A-“. The move reflects the carriers’ relative concentration in the California workers’ comp market and the expectation that earnings will remain below Best’s “A” rating level standards over the near to immediate term, despite recent broad-based rate firming.
Despite major improvement in the state’s workers’ comp pricing environment in the last 18 months, A.M. Best continues to have a negative view of the industry’s expected short-term results.
While recent rate increases will help offset some underwriting pressure, A.M. Best feels the market’s overall pricing remains inadequate.
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